Legislature passes $8.2 billion State School Fund; cuts looming

Tuesday, June 27, 2017

Rep. Rich Vial (R-Scholls) says it is “a source of pain” to him to vote against a schools budget on Tuesday in the House. He says he supports students and teachers but Oregon needs to get control of its pending. “We have to make better choices,” he said. (Photo by Jake Arnold, OSBA)

Despite across-the-aisle agreement that the bill did not meet Oregon’s goals for education support, Senate Bill 5517 narrowly passed Tuesday in the House.

The bill, which would appropriate $8.2 billion for K-12 education, has already passed the Senate and now goes to the governor. A number of districts statewide say this budget figure will lead to cuts of varying sizes.

Democrats described the bill as the best they could do with present tax revenue.

“What we are looking at today is a status quo budget,” said Rep. Barbara Smith Warner (D-Portland) on the House floor. “We’re not making deep cuts, but we’re also not making new strategic investments in our K-12 schools because of our broken and inadequate budget system.”

Republicans who opposed the bill said it wasn’t enough for schools, and they blamed out-of-control spending, particularly on public employee health care and the Public Employees Retirement System.

“The broken and inadequate revenue system … is something we cannot fix without securing the trust of the voters and taxpayers,” said Rep. Rich Vial (R-Scholls). “They do not trust us that if we simply raise more revenue it is only going to go to education.”

The bill passed 31-28, with four Democrats opposed, including Rep. Diego Hernandez (D-Portland).

“I will not vote for a budget that maintains our mediocrity, or as we call it ‘current service level,’” said Hernandez in testimony. He is a Reynolds School Board member and said the budget would lead to more cuts at his district.

Education advocates expressed disappointment.

“This budget, like this entire session, should be filed under missing – for missing leadership that led to missed opportunity,” said Jim Green, OSBA executive director. “Our elected leaders did not address runaway costs. They did not act to reform our revenue system.

“As a result of this leadership failure, our students will pay the price. And what those young people are missing is instructional time, school days and ultimately the opportunity for a better future. It’s very disheartening.”

The bill appropriates $7.7 billion from the General Fund, $400 million from lottery funds and $67 million in miscellaneous funds that includes $63 million from marijuana tax revenue. That money is dependent on passage of Senate Bill 845, which would move education-bound marijuana tax money from the Common School Fund, which provides schools money from interest on investments, to the immediate-spending State School Fund. SB 845 has passed the Senate and is in the House.

The preliminary budget report for the education bill also noted some new or changing carve-outs from the State School Fund.

The bill would set aside nearly $1 million for 10th-grade assessments, and $1.6 million for the Oregon Virtual School District. It would also use $2.5 million to provide free lunches to students eligible for reduced-price lunches.

School boards around the state have prepared budgets for the fiscal year that starts July 1. Districts, based on previous legislative proposals, were working off expectations of anywhere from $7.8 billion to $8.1 billion. Most of those district budgets included cuts or dipping into reserves just to hold steady. A State School Fund of $8.2 billion gives schools a little more breathing room but won’t close the gap for many of them.

Gresham-Barlow made its budget plan based on $8.1 billion in the State School Fund. It was facing a $3.5 million shortfall and using $2 million in reserves. The slightly higher budget will help reduce the cuts.

“We’re pretty lucky,” said Gresham-Barlow School Board Chair Carla Piluso. “It does look like cuts for us but not as drastic as other districts.”

Rep. Piluso (D-Gresham) would like to see a revenue package that allows the district to invest in improving education outcomes, not just find ways to stave off cuts.

Beaverton says it will have to cut by $11.5 million, including staff, professional development, supplies and support for students in poverty at an $8.2 billion State School Fund, according to data gathered by the Confederation of Oregon School Administrators. North Clackamas’ plan for dealing with a $2.1 million cut in current operating costs at $8.2 billion includes staff cuts and a furlough day. Bethel plans to cut five school days, and Salem-Keizer will lose 63 licensed educators.

In addition to losing teachers and raising class sizes, some districts will cut other services, according to the COSA report. Newberg will eliminate a pregnant and parenting teens child care center. Junction City will cut technology and textbooks. Klamath County’s budget plan includes deferring $110,000 in maintenance.

There is still the possibility of money being added to the State School Fund in an end-of-session bill known as the Christmas tree bill. A Christmas tree bill contains funding for particular projects, “ornaments” to attract votes.